Bridgestone projects little change in net sales for Bridgestone/Firestone

Dec. 5, 2001

Bridgestone/Firestone Americas Holding Inc. (BFAH) is expected to post only a slight drop in net sales in North and South America in 2001, according to recent Bridgestone Corp. projections.

For 2001, full-year sales for BFAH are expected to total $7.4 billion compared to $7.5 billion in 2000. Bridgestone says sales have been impacted by the downturn in the U.S. economy, including a reduced demand for passenger and light truck vehicles.

Bridgestone projects a $1.66 billion loss for BFAH, which was established as a holding company for Bridgestone Dec. 1.

The company pins most of the loss on "the establishment of one-time reserves to address the impact of certain activities during 2001, such as the closure of its Decatur, Ill., facility and write-down of the assets of BFAH." Of the $1.66 billion, $1.61 billion will be attributable to the special charges.

Other second half charges include a provision of $285 million for additional litigation related costs and expenses; $50 million related to the closure of the Decatur, Ill., plant; and $25 million related to the tire replacement program announced by the company in October 2001.

Bridgestone Corp. says it will provide BFAH with a capital infusion of $1.3 billion in January 2002.

BFAH expects to be profitable for the full year 2002, according to a company spokesman.

The parent company's consolidated net sales for 2001 are expected to come in at $17.5 billion, a drop of 6% from 2000. Bridgestone attributes the loss to the slowdown of the global economy.

The company predicts its net earnings will total $150 million.